Sounds like the medical industry had better lobbyists.
Therefore, any market for individual purchase of healthcare (whether via insurance or directly) can only have faulty price signals.
Systems based on markets with faulty price signals are wide open to manipulation.
The perpetuation of such markets is contemptible, and particularly so in the case of healthcare since there is a straight line to be drawn from dysfunctional systems to human suffering.
Perhaps it is just to make sure they always get the max from the insurance companies. Or maybe they are able to write off the portion that the insurance company won't pay as a loss or bad debt.
Personally, I believe this practice to be outright blatant fraud. There is a complete lack of price-transparency for the end-user, whether there's an insurance company involved or not. And for people who supposedly champion the so-called "Free Market", Congressional Republicans are certainly quiet on this one issue, when they're criticizing the current healthcare system and regulations.
The real problem is that I rarely have any reason to ask if my insurance is going to cover all of it.
Take Florida Statute 581.026, titled Florida Patient’s Bill of Rights and Responsibilities
Subsection (4)(c)(5) reads: a health care provider or a health care facility shall, upon request, furnish a person, before the provision of medical services, a reasonable estimate of charges for such service.
In one case I represented a patient who video recorded asking a health care admin for an estimate and getting an answer of under $2,000. The bill ended up being somewhere between $12,000-$14,000. A single letter citing the law and the patients entire bill was discharged by the health care facility.
Or pushed it onto tax payers somehow.
Also as the system gets itself more expensive, the mechanics that make it more expensive can also become more worthwhile! Its a spiraling costs issue.
Man healthcare in the U.S. is so broken.
If they ate the cost, someone else paid for it. Which means that prices in general take this into account. I'm not judging OP, but saying that the ability to apply that technique is not= the solution to the general problem. (Healthcare is expensive).
On the back end, there is the cost of lawsuits that also drives up prices systemically.
And, finally, not everyone pays their bills to their insurance companies. Everyone else has to pay those costs.
In these ways, insurance will always be an every increasing spiral of cost, eventually.
> On the back end, there is the cost of lawsuits that also drives up prices systemically.
Here's one example. A (probably not domesticated) cat scratched someone. They went to get shots. Waited a couple of hours and got the shot. Bill in the mail for about $8k. Somehow, I really doubt Humana paid their 80% which is $6,400 but of course the patient has to pay the 20%. I suspect what is happening is that Humana pays close to $0 and the patient picks up the whole tab of $1,600.
I totally get your point, but is that real example?
http://health.costhelper.com/cat-scratch-disease.html
Typical costs:
- For patients covered by health insurance, out-of-pocket costs typically consist of doctor visit copays, prescription drug copays of $5-$50 or more, or coinsurance of 10%-50%. Cat scratch fever treatment typically is covered by health insurance.
- For patients not covered by health insurance, cat scratch fever treatment typically costs less than $10 for over-the-counter pain relievers. For severe cases in which antibiotics are required, it typically costs from $30-$90 for oral antibiotics. For example, Drugstore.com charges about $30 for a two-week course of the generic antibiotic rifampin. It charges about $80 for a two-week course of the antibiotic ciprofloxacin. And it charges about $90 for a two-week course of the generic oral antibiotic azithromycin.
- In the extremely rare cases in which serious complications occur and hospitalization is required, cat scratch fever treatment can cost tens of thousands of dollars. According to Medscape.com, the median hospitalization charge[1] for cat scratch disease is about $46,140.
Yes, it actually happened. Overland Park, Kansas around July 2013 if I remember correctly. Also no fever. More like rabies and tetanus shots from what I heard.
What if we could force all hospitals to disclose all financial transactions publicly? Would that help?
Nobody can afford that. Especially with how drug prices have escalated. And in some of these chronic conditions, the end-stages become very costly.
Insurance absorbs the early costs of regular care, which PREVENTS both chronic conditions, and these costly end-stages. (This is widely-accepted science, not insurance company marketing).
So this catastrophic-only model simply is not tenable, will not work. Unless either these treatment prices come way, way, down. OR: we address the real source of the problem, which is that incomes have not come up to meet these niche costs which have inflated greatly, yet somehow avoided being measured and added to overall inflation statistics. ("hedonic adjustments", anyone?)
Trump actually campaigned on lowering drug prices. Yet for all we've sacrificed to endure a Trump presidency, they've done absolutely nothing to address this problem. And they won't. I assure you.
Therefore - the shitty-compromise solution must be: government pays. Because they're too cowardly to fix the problem any other way. Government pays until government can't. So they just borrow more. Not even "plain speaking" Trump has the balls to work these two problems. (Drug prices, and income stasis).
Instead, the only plan Republicans can come up with is kick more people off their insurance, and don't change anything else.
"Adam Ruins Everything" had a really good segment on this.
The mechanic gives you a quote. If the costs changes they get your explicit approval.
That would be nice to start there on the medical side.
No one minds if there are common sense exceptions.
Of course there may be emergencies that come up that are unpredictable, but that doesn't mean you can plan for some of it!
Also, funny comparison, try to make it with software engineering.
If you held a mechanic to the same standard, they "wouldn't know the cost" either.
Maybe the doctor's office doesn't know your out-of-pocket cost, but they generally know (within a reasonable rage) how much they will bill the insurance company for. Perhaps an underlying problem is that a health insurance-medical pratcice contract prevents the medical practice from revealing the negotiated+contracted costs.
In the case that the nurse/doctor/surgeon decides to change the prognosis/prescription during the visit, there are provisions for that type of action with auto mechanics, too.
Try estimating software development costs with no idea what is to be written. With software at least no one will die, and probably no one will sue if you are wrong.
We don't know either. In fact you have to build infrastructure just to know estimates, which will be cleared months later, and a result might be less or more price. It is not a transparent system for the provider either, specially when you are a small one.
> In the case that the nurse/doctor/surgeon decides to change the prognosis/prescription during the visit, there are provisions for that type of action with auto mechanics, too.
I honestly think the problem is fee-as-service, where you have to make very complex calculations based on how each thing is claimed. It would be very different if work was provided per-hour basis, or even per-result (complex, but market is leaning towards that right now).
Figure a software engineer consultant charging differently per language, platform, stack version, LOC, cost of materials etc each time he works an hour. IF you are an engineer try to picture how that works.
1- You diagnose a problem to solve
2- You look into a list of 70k items to look for the corresponding code to that problem (C10.023 Turn iterative code to recursion)
3- You now write what you are going to do to solve it
4- Now you have to pick a billing code (CPT code 94102 -> Iterative on GC language to functional programming language ). You estimate 94102 will pay 50$, but are tempted to put 94103 which will pay 75$, from Iteractive non GC, because actually your custom language settings have GC turned off, but are unsure if the insurance company will believe or care
5- The client asks you how much will charge, considering he is personally liable for 20% of it because the actual client doesn't re-imburse everything.
That was a single visit. Doctors get 12-16 a day.
What I'd like to see for medical services, is something like an apendepticamy takes 1 hour to perform, plus 4 hours of prep, and 2 hours follow up spread over several weeks. The procedure uses one primary surgeon, one assistant, 2 nurses, an and anesthesiologist, each charging x per hour (depending on role / specialty). The hospital charges y per hour for the room, z for the supplies.
All of this is known ahead of time. Yes, there can be complications. Just like a mechanic can run across rusted on bolts that take longer to remove. But going by book time for everyone works out in the averages.
Heck, both dentists and optometrists work in this fashion for most of their services. Why can't the rest of the medical world get it together?
Every procedure, every Tylenol, every operating kit has a code and a price and that is all itemized and billed.
Try calling up your mechanic and asking for a quote. Tell them your car is not working right and you don't know what's wrong, but you want a quote before bringing the car in.
Now, if you call a medical practitioners and tell them exactly what tests or procedures you want, they can probably look that up for you.
What you want is a buddy like Ed who can get the cost knocked down by 90% https://youtu.be/pY-BGNjI2Rg?t=6m18s
Does that include a situation where say, when emptying out the oil, the nut over the drain breaks off which necessitates changing the oil sump, except they then discover the engine mounts are rusted and now the engine needs to be lifted and the mounts replaced? (I'm not a car guy, but I hope this demonstrates the thought even if inaccurate)
Yes it does because the mechanic is required to call you and say, "Upon further examination we also need to do ______ with will cost $XYZ. Do you want to proceed with this?".
If you say no you can pick up your car and go somewhere else. It's not that the mechanic is taking on the risk of an oil change turning into a full engine rebuild. They're simply required to announce what they're going to bill you for before they start work.
That way if the mechanic say, "It'll be $500 for me to change your cabin air filter." you can find a new mechanic.
But, that idea ignores a fundamental problem with expert-based markets; it's impossible to me, as a non-consumer, to make a rational decision about which mechanic to use because to me, the mechanic is a black box. I don't have any way to immediately fact-check what they're telling me, and in the worst case, if a mechanic does something wrong, I may not find out about it until it's far to late to hold the do-er accountable. Thus, I can change mechanics based on the limited information I have available (price signals, perceived reputation) but, A) this distorts the market to optimize for low prices and perceived reputations instead of efficient prices for quality work, and B) I don't ultimately have any way of knowing whether I'm making the right decision when participating in this market. At least, not in the time frame where that knowledge is useful.
The same, holds true with 'free' health markets; I'm not a doctor so I can't accurately tell if my doctor is lying to me, which should cause similar distortions in an ostensibly free healthcare market. Additionally, as with an auto mechanic, if I need something done -now-, my demand for that service becomes completely inelastic, which means prices for emergency services/procedures should become obscenely high.
They already are today, and people are -already- getting forced into bankruptcy by emergency medical expenses, so I can't speak to whether or how a market sans insurance might change that phenomenon, but it seems to me that the goal ought to be to eliminate it entirely, and that in turn a 'free' healthcare market cannot be the end goal.
That said, I don't think I know enough about the subject to pick out a particular optimal solution to this problem. I like the -idea- of single payer or other universal healthcare solutions, but I haven't studied any of them in enough depth to analyse them critically; dealing with healthcare in the UK was a joy while I lived there, so I wouldn't mind having that experience here in the US, but that in turn requires a lot of government funding (among other things), and we can already see that that's unsustainable in the short term by what's happening to the ACA.
Customer comes in for an oil change. Change the oil, go to start the car, it won't start. A bit of diagnosis later, and the ignition control module has coincidentally decided to die. It's an old GM, so thankfully it's only $35, but still: the car was running when the customer dropped it off. I hate those phone calls. Customer said, "okay, do it". Had they not, we probably would have just dropped a module in and eaten the cost. I mean, what are you going to say? "Umm, yeah, it's just coincidence that you need to spend $35 more before you can drive it home"?
I also tell customers ahead of time the possible outcomes of the work. Honda comes in needing a top-end job, but it has over 100K miles on it. I tell the service writer that we can do the job, but it stands a chance of blowing the rings. (New valves with better sealing on the top end, now the piston rings are the weak link.) Customer is informed, I do the job. Two weeks later, the Honda pulls up blowing smoke. Told you so. I forget the outcome, but I don't recall pulling the engine on that one.
But they don't always say, "yes". Customer comes in looking for an estimate on a brake job. You know that grinding you hear when your pads are shot to hell? Imagine what happens when you let that go for, say, a couple of months. Imagine no more, I'll tell you what happens: it'll grind the rotors down to the cooling vents such that what's left of the brake pad backing plate no longer has a solid surface upon which to grind. Of course wheel bearings are shot, calipers need replaced. It was a long time ago, but many hundreds of dollars were estimated. Of course this is on a piece of shit that isn't worth fixing for that much. The vehicle is not safe to drive by any means. Customer doesn't want to do the work (duh). What did I do? Put the wheels back on and let them drive off. We're mechanics, not the state police, but trust that there was discussion of what "the right thing to do" was.
Your surgeon is in the middle of heart surgery. You wanted an estimate on a (cardio) valve job. Surgeon gets in there, your arteries are all clogged up. Wake the patient and ask for approval on the extra expense? Button 'em back up and negotiate the cost later?
So the car analogy doesn't work for all cases, or very well at for human beings.
Many medical procedures and therapies have very predictable costs and outcomes. And have checkpoints to re-evaluate whether to proceed further.
And accountants and could probably also price in the cost of the occasional problematic case and include a buffer in the standard price to account for it.
There are plenty of straight forward ways to provide prices for the vast majority of medical procedures, if the proper incentives were in place.